EU crisis concerns Brazil's agribusiness

Brazil’s huge agribusiness sector is concerned about the impact of the debt crisis in Europe and slower growth in China, the president of the national Confederation of Agriculture (CNA) said on Tuesday.

“The bigger risk for the agribusiness sector is a credit shortage as the Brazilian harvest depends on financing from Europe,” Katia Abreu said, referring to the eurozone debt crisis.

Abreu said CNA was hoping that the Chinese economy would grow at least 7% or 8% next year so that Brazilian farm exports would not be adversely affected.

China’s GDP is expected to expand 8.9% next year, according to forecasts by the Chinese Academy of Social Sciences (Cass), down from an expected 9.2% this year and from the blistering 10.3% recorded in 2010.

Brazil’s 2012 grain harvest is expected to reach a record 153 million tonnes, 6.3 million more than this year, due to technological advances and a 3% increase of the country’s cultivated areas, CNA said.

One major threat to next year’s Brazilian harvest is the La Nina weather phenomenon which is linked to flooding and drought.

CNA hopes that the country’s farm exports will reach $92.9-billion next year, up 2.2% from the 2011 figure.—AFP